While the ICBC is government-run, it still operates like any other insurance company. This means it uses the same determining factors as private providers when assessing how much a customer should pay for their policy:
- Age and gender
- Driving experience
- Driving record
- Type of vehicle
- Level of coverage needed
- Intended vehicle use and location
Prohibitive cost of insurance in BC
Despite a government led insurance market, British Columbia is the second most expensive province in Canada. As our provincial guide shows, the average cost of auto insurance in British Columbia is $1,237, a figure that is a full $200 above third-placed Alberta ($1,086).
The important question to ask is why BC is such an expensive market, especially when the government has more control over regulations?
Unfortunately, BC has many of the same problems as Ontario, albeit on a lesser scale. Like Canada’s most expensive car insurance market ($1,551), BC is plagued by rampant fraud, which contributes negatively to the average price of premiums. Other reasons include tight mandatory minimum liability controls and generous accident benefits regulations.
Will car insurance rates in British Columbia fall soon?
While Ontario is meeting its premium cost crisis head on, British Columbia is struggling to manage spiralling costs. Instead of rates falling, there has been a gradual trend of premium increases in recent years. Since 2012, auto insurance premiums have increased by at least 4.0% in each year. In 2012, rates increased 11.2% and in 2016 they increased 4.9%. ICBC says increased claims and collisions are behind the raises.
Auto insurance requirements in British Columbia
With high rates that are continuing to increase, BC is a cocktail of financial worry for anyone who wants to insure a vehicle. Needless to say, auto insurance is mandatory in the province for any person who purchases a vehicle.
This mandatory coverage can be the basic level policy offered by ICBC:
- $200,000 in third-party liability insurance: covers both bodily injury and property damage. Within this amount, property damage will be capped at $20,000.
- Underinsured motorist protection: up to $1 million per person.
- Medical coverage: up to $150,000 per person.
- Hit-and-run coverage: up to $200,000.
- Inverse liability coverage: this insurance covers you when the local laws don't let you make a claim against the at-fault party.
- The coverage is up to 100% of the claim, but it accounts for the degree you're partially at-fault. If you're 25% at-fault, you receive only 75% of the covered costs.